Mass. unemployment rate rises as economy slows

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Massachusetts’ unemployment rate ticked up slightly in July as the state’s economy continued to slow last month, adding just 1,600 jobs, the Massachusetts Executive Office of Labor and Workforce Development reported Thursday.

The state’s unemployment rate rose to 6.1 percent, from 6 percent in June, the first increase since October 2009. The state jobless rate, however, remains well below the national average, which also rose slightly in July, to 8.3 percent.

“It looks like both the state and the nation are growing slowly,” said Northeastern University economics professor Alan Clayton-Matthews. “This was expected given the conditions in the world.”

The debt crisis in Europe and an economic slowdown in China, combined with concerns about how the US Congress will resolve the federal budget stalemate have fueled a climate of uncertainty among businesses and consumers. Those unknowns — with presidential election approaching — appear to have weighed heavily on employers, who have reined in expansion and hiring.

Massachusetts’ economic health is more heavily dependent on trade with Europe than the nation. About 40 percent of the state’s exports go to the European market, compared to about 20 percent nationally.

Job growth in the state has slowed considerably after strong gains in the beginning of the year. In the first three months of the year, Massachusetts employers added an average of 9,500 jobs a month; over the past three months, job gains have averaged just 2,400 a month, according to state employment statistics.

The state’s economic recovery has also been uneven among professions and the state’s various regions. Communities in Western Massachusetts still have some of the highest unemployment rates in the state, while the state’s high-tech industry closer to Boston continued to grow, said Michael Goodman, a professor of public policy at the University of Massachusetts at Dartmouth.

In Cambridge, for example, the most recent unemployment rate was 4.2 percent; in Springfield, the jobless rate was 10.3 percent, according to state figures.

Job gains in July were led by education and health services sector, which added 4,000 jobs, and the professional scientific and business services, which includes technology and technical firms, lawyers, and consultants. That sector added 1,000 jobs.

Massachusetts’ construction sector gained 900 jobs in July, but remains far from recovering from the last recession, which hit the industry particularly hard. In the past year alone, the sector has lost 3,900 jobs.

Government employers gained 500 jobs last month. State government added 600 jobs and the federal government 100.

Those gains were offset by the loss of 200 jobs in local government. Over the year, government employers have shed 2,900 positions.

Manufacturing in Massachusetts held steady, gaining just 100 jobs over the month. So far this year, the sector has lost about 3,900 jobs.

The state’s leisure and hospitality industries lost 1,600 jobs in July. Over the year, the sector has showed modest gains of just 600 jobs.

Trade, transportation, and utilities lost about 1,100 jobs, though the sector has added 8,900 jobs over the year.

Financial services lost 1,000 jobs last month. Job growth in the sectors is flat for the year.